Until recently, few in the art world had even heard of China’s auction houses,
but today they account for five of the world’s top 10 by revenue

A telephone bid is made at the Poly International Spring Auction of Modern and Contemporary Chinese Art in Beijing on May 31, 2007.

Photo: Bloomberg

Until recently, few in the art world had even heard of China’s auction houses. Today, they are among the world’s biggest by revenue, posing a serious challenge to the likes of Sotheby’s and Christie’s.

Though still much smaller in size than their foreign rivals, China’s

auction houses now account for five of the world’s top 10 by revenue, according to a recent report by the France-based industry association Conseil des Ventes.

Their rise has been fuelled by wealthy Chinese collectors’ vast appetite for art and antiques and aided by regulations that have locked overseas competitors out of China.

It nevertheless represents an extraordinary turnaround for an industry that has for centuries been dominated by a handful of established European brands.

“From 1776, when we were founded, to about five years ago, our main competitor was Sotheby’s. Well, today in Asia, the landscape has changed,” explains Francois Curiel, president of Christie’s Asia. “For the first time in history, local auction houses are doing better than us in a local market.”

The two biggest, Beijing Poly and China Guardian, rank only just behind Christie’s and Sotheby’s, having overtaken more established names such as Bonham’s in just a few years.

Last year Poly booked sales of US$190 billion — more than the combined revenues of Christie’s and Sotheby’s for the entire Asia region. China Guardian recorded revenues of US$1.8 billion, up from US$282 million only three years ago.

Their success comes as China’s new breed of art collectors have propelled Beijing, and to a lesser extent Shanghai, to the forefront of the art scene, with Chinese works of art regularly breaking records at auction.

Last year Qi Bashi (齊白石) and Chang Ta-chien (張大千), two modern Chinese artists who specialize in ink paintings and calligraphy, overtook Pablo Picasso and Andy Warhol as the world’s best-selling artists by auction revenue.

A Qi painting titled Eagle Standing on Pine Tree sold for US$57.2 million in May last year, the highest price reached by any work of art at auction last year.

“China’s new rich have very little way of spending their money. Art is one of them,” said Wang Yannan (王雁南), director and president of China Guardian, which was founded in 1993.

Beijing is now the world’s biggest art market, with 27 percent of global auction revenues, according to data compiled by the specialist Web site Art Price.

But foreign auction houses are not allowed to set up shop in China, putting them at a geographical disadvantage in targeting Chinese buyers, although both Christie’s and Sotheby’s have booming operations in Hong Kong.

“Five years ago, China business was four percent of our annual sales in Hong Kong. Now that figure has risen to between 40 and 50 percent,” said Kevin Ching, chief executive of Sotheby’s Asia. “A lot of this can be attributed to the rise of China as a world economic and political power.”

While Christie’s and Sotheby’s have to limit their presence in Beijing to a sales bureau and previews, several Chinese auction houses are expanding overseas.

Poly and Guardian have both opened offices abroad to source Chinese art, much of which is in Western collections.

They are courting sellers in Europe and the US by offering them greater access to Chinese buyers than the foreign auction houses operating out of Hong Kong. “We are facing a lot of competition outside of China. Poly and Guardian have opened offices overseas to source as much as artwork as possible, and they picked up very quickly,” said Curiel of Christie’s Asia. “Generally, Chinese buyers are looking for the best.”